This Communication aims to improve safety in the seaborne petroleum products trade.

ACT

Commission communication of 21 March 2000 to Parliament and the Council on the safety of the seaborne oil trade [COM(2000) 142 final - Not published in the Official Journal].

SUMMARY

On 12 December 1999 the oil tanker Erika broke in two 40 miles off the coast of Brittany (France). More than 10 000 tonnes of heavy fuel oil were spilt, thereby creating an ecological disaster. Pressure of public opinion prompted the Commission to propose action at Community level.

According to the Commission, this action "is designed to bring about a change in the prevailing mentality in the seaborne oil trade. More powerful incentives are needed in order to persuade the carriers, charterers, classification societies and other key bodies to give a higher profile to quality considerations. At the same time, the net should be tightened on those who pursue short-term personal financial gain at the expense of safety and the marine environment."

The seaborne petroleum products trade: state of play

Of all basic products in the world, oil occupies the leading position in the transportation stakes. The European Union (EU) occupies the number one position in the petroleum products trade. By way of comparison, its crude oil imports represent about 27% of total world trade, as against 25% for the United States. Close to 90% of the oil trade with the EU relies on sea transport (the rest being routed by pipeline, land transport or by inland waterway). Taking into account the forecast levels of demand for petroleum products, the deployment of oil tankers is expected to grow and grow over the years to come.

Each year, 800 million tonnes are transported to or from Community ports. About 70% of oil tanker movements in the Union are along the Atlantic and North Sea coasts (the remaining 30% being via the Mediterranean), thereby making these zones the most vulnerable to oil spills, as demonstrated by the sinking of the Erika and, more recently, the Prestige.

On top of that, many oil tankers cross the waters of the Union without calling at EU ports, and this represents an additional volume of traffic, and hence an additional danger. The Union's major oil ports are Rotterdam, Marseille, Le Havre, Trieste and Wilhelmshaven. The imported oil comes mainly from the Middle East and North Africa. European exports (from the North Sea oilfields) go mainly to destinations in North America.

The crude oil transport market is dominated by high-tonnage vessels (over 200 000 tonnes). However, the vessels used in the North Sea are more modest in size, ranging from 5 000 to 50 000 tonnes. Some 15 000 to 20 000 vessels operate in the waters of the Union each year.

In 1999 the average age of vessels making up the world oil tanker fleet was 18 years, with 41% of them more than 20 years old. The latter group represent 36% of oil tanker tonnage. In the EU, the average age of registered oil tankers in 1999 was 19.1 years. Over 45% of the European fleet is more than 20 years old. European companies frequently register their vessels under foreign flags. Thus, the flags frequently used by EU interests include those of Liberia, Panama, Cyprus, Malta and The Bahamas.

Between 1992 and 1999 the number of ships lost worldwide totalled 593, of which 77 were oil tankers. While this figure corresponds to only 13% of the number of accidents, it nevertheless represents 31% of the lost tonnage. Despite these figures, the results in terms of safety may be regarded as relatively good. The causes of accidents at sea can vary widely:

Accidents are often attributed to human error (navigation or pilotage error). Crew training and crew skills have been recognised as key elements in improving safety at sea. In addition, working conditions constitute an equally important factor, particularly as fatigue is recognised as a growing cause of accidents at sea.

There is a general correlation between the age of vessels and the accidents that have occurred. 60 of the 77 oil tankers lost between 1992 and 1999 were more than 20 years old.Problems associated with the structure (breach in the hull, corrosion, etc.), fire and explosions are among the other causes of accidents.

The chartering practices peculiar to the oil trade also add to the complexity of the situation. Oil companies in fact control only a quarter of the world fleet. What we are witnessing is a process of "fragmentation" among the oil tanker owners. By dispersing their fleet among single-ship companies, often taking the form of dummy companies registered in offshore financial centres, owners are able to reduce their financial risks. Consequently, it is often difficult to identify the real decision-makers and hence to determine where responsibility really lies.

The oil trade and the charter market operate in a highly competitive atmosphere. Finding the cheapest oil tanker carrying capacity on the market is an essential part of the operation. The volatile nature of the market is also resulting in a move-away from long-term contracts between charterers and carriers towards short-term charters (the so-called "spot market"). Prices on this market are fiercely competitive. In reality, the age of the oil tanker plays little part in the decision-making process; often it is the cheapest available tonnage offered by the oldest ships that dictates prices. It is therefore difficult to create a situation where quality pays, so much so that small operators with low overheads are winning over parts of the market at the expense of companies with well established reputations. This phenomenon poses a risk to safety.

Existing measures to ensure safety

Following several disasters (Torrey Canyon 1967, Exxon Valdez 1989), a series of conventions were drawn up under the auspices of the International Maritime Organisation (IMO). Their aim was to combat accidental pollution (unforeseen events) and operational pollution (deliberate acts, such as the cleaning of tanks with seawater). For example, the International MARPOL Convention for the Prevention of Pollution from Ships was adopted in 1973.

Apart from the environmental aspect, this convention also seeks to bring about the gradual phasing-out of single hull oil tankers and their replacement by double hull tankers or tankers of equivalent design. The MARPOL Convention also provides for more rigorous checks on the state of ageing oil tankers. Down the years the IMO directives have become more and more specific, and oil tanker hulls are now subjected to much more stringent inspections than was previously the case.

Again, as a result of MARPOL, oil tankers built since 1966 have to have a double hull or be of equivalent design, while single hull oil tankers are gradually being phased out. Double hull vessels will reduce considerably the risk of pollution, particularly in incidents involving slight collisions or grounding. On 1 January 2000, double hull vessels accounted for about 20% of the world's oil tanker fleet.

Traffic separation schemes have been adopted in high-density shipping areas (e.g. one-way sea-lanes which sharply reduce the risk of head-on collisions in the Strait of Dover). In the future, navigation equipment will be more reliable and more accurate. Satellite navigation technology provides a greater degree of precision and reliability (in particular, the Galileo system).

At the same time, however, it has to be acknowledged that action on maritime safety under the auspices of the IMO falls short of what is needed to tackle the causes of such disasters effectively. Action by the IMO is severely handicapped by the absence of adequate control mechanisms governing the way the rules are applied throughout the world. As a result, IMO regulations are not applied everywhere with the same rigour. The evolution of maritime transport over the last few decades and, in particular, the emergence of "flags of convenience" (registration of vessels in foreign countries), some of which fail to live up to their obligations under the international conventions, is tending to aggravate this phenomenon.

It was for this reason that the European Council called on the Commission, following the 1978 Amoco Cadiz disaster, to come forward with proposals to control and reduce pollution caused by oil spills. In the event, however, little has been done. Once the "momentum" generated by an accident has subsided, Member States have tended to avoid binding measures at Community level, all the more so since unanimity used to be required for decision-taking.

It was not until the mid-1990s and the advent of qualified majority voting that the Council was able to adopt the first building blocks of a common maritime safety policy, including the organisation at Community level of stricter application of international conventions and the adoption of measures of a specifically Community nature in cases where the IMO standards were non-existent or inadequate. In the meantime, the following instruments have been enacted:

- Directive 95/21/EC, amended by Directive 2001/106/EC on port State control. This Directive provides for inspections to be carried out on all vessels and includes specific requirements relating to the inspection of oil tankers.

- Council Directive 94/57/EC, amended by Directive 2001/105/EC. This Directive lays down common rules and standards for ship inspection and survey organisations and for the relevant activities of maritime administrations.

- Regulation (EC) No 2099/2002 establishing a Committee on Safe Seas and the Prevention of Pollution from Ships (COSS) and amending the Regulations on maritime safety and the prevention of pollution from ships.

The Erika disaster demonstrates, firstly, the risk presented by old ships and, secondly, the need to tighten up, on a specifically Community basis, the existing Community regulatory framework which, incidentally, Member States are not applying properly, particularly as regards the number of inspections in ports beyond the level of the IMO standards. This was also the tendency in the USA, where the regulatory framework was tightened up at federal level following the Exxon Valdez disaster.

Proposals for immediate action

The Commission is proposing a number of measures that could be taken immediately, as well as longer-term, more complex measures which will be the subject of a second legislative package.

With regard to the short-term regulatory measures, the Commission is presenting three sets of measures to Parliament and the Council with this communication:

Port State control. This is a proposal to amend Directive 95/21/EC. It is proposed to ban from all ports of the Union ships older than fifteen years that have been detained more than twice in the course of the two preceding years, on the basis of a "blacklist" which the Commission will publish every six months. In addition, inspections of all ships will have to be stepped up in line with the age of the vessel and will systematically have to target one of the ballast tanks. Ships will be required to communicate certain information before entering ports to enable inspections to be properly prepared.

Classification societies This concerns Directive 2001/105/EC. In the Commission's view, there needs to be stricter monitoring of the classification societies to which Member States delegate power to inspect the quality of ships. The Commission, using a simplified procedure, reserves the right to suspend or withdraw recognition from societies that fail to comply with the criteria laid down in the Directive.In addition, more stringent quality criteria must be met by the recognised organisations, including the obligation to follow certain procedures when a ship changes class, such as the transmission of the complete history file of the ship to the new classification society.

Double-hull oil tankers. This is a Directive proposing to speed up the replacement of single-hull oil tankers by double-hull oil tankers following a timetable similar to that adopted in the United States (2005, 2010, 2015 depending on tonnage).

These three pieces of legislation form a single entity and apply not just to oil tankers but, in the case of the first two proposals, to any ships transporting dangerous or pollutant substances. In particular, the information gathered in the course of inspections in each port or of surveys by the classification societies will be widely publicised, notably through the Equasis database (cf. point 18.1), so that the condition of a vessel will systematically be known and individual liability will be clearly established in the event of an accident.

Proposals for future action

In a second stage, the Commission plans to make additional proposals in the following areas:

Increased transparency. The authorities are seriously concerned at the lack of availability of information on matters of relevance to ship safety. While a great amount of information on ships is being collected by various bodies, it is scattered in many different places and often difficult to access, even for the maritime industry at large. Consequently, the European Commission, in cooperation with the maritime administration of France, has initiated the creation of a new ship safety database, Equasis, which will collect information relating to the safety and quality performance of ships and their operators and which will be available on the Internet.

Surveillance of shipping. The Commission proposes improved surveillance of shipping, particularly in those areas where oil tanker traffic is most dense. In the Commission's view, the arrangements for inspection of the most dangerous ships outside territorial waters need to be examined. Indeed, there have been cases of particularly dangerous ships sailing along the coast of one or more Member States before the problem could be detected in port. Consequently, inspections in ports do not always provide an adequate solution.

Enlargement of the EU. From the point of view of maritime safety, the accession negotiations present a challenge. If the 13 candidate countries were to join the European Union today, the average number of ships detained flying the European flag would increase to 13.26%. This high percentage is due to the below-average performance of ships flying the flag of certain candidate countries, notably Malta and Cyprus, which have the fourth and fifth largest fleets in the world. For the Commission, such a fall in the level of safety of EU shipping is unacceptable and cannot be justified on the grounds of enlargement. It is therefore essential that the candidate countries commit themselves, as soon as possible and certainly no later than the date of their accession to the Union, to the scrupulous application of the international and European maritime safety standards.

Towards a European maritime safety structure. In its communication, the Commission reflects on the possibility of establishing a European maritime safety structure, whose prime task would be to monitor the organisation and effectiveness of national inspections in order to ensure greater uniformity.

Extending the liability of the various players in the seaborne oil trade. The liability regime is currently governed by international conventions. The Commission intends, firstly, to seek to increase the number of collective compensation schemes, but also to establish the principle of liability on the part of the carrier and the owner of the cargo.

Before proposing new Community legislation in the social field in particular (training of seafarers, etc.), the Commission wishes to draw attention in this communication to the fact that several of the measures already adopted have still not been correctly implemented. Some of the texts already adopted have either not been transposed or are not being properly applied, with the result that infringement proceedings are in progress in several cases.

Furthermore, while deploring the widespread recourse to flags of convenience, the Commission would also point out that most of the vessels controlled by European companies have been flagged out to third countries for tax reasons. Having said that, the Commission considers that it should be a condition of the accession negotiations with Cyprus and Malta that these countries apply the existing Community legislation on maritime safety as soon as possible and certainly no later than the date of their accession.

Voluntary agreement with industry

In order to act as speedily as possible and to avoid further disasters like the Erika, the Commission proposes that the oil companies should undertake by voluntary agreement to refrain in future from chartering tankers older than 15 years (unless appropriate inspections show them to be in a satisfactory condition) and to take any other measures necessary to improve safety. The discussions on this voluntary agreement should also be reflected in improvements to the reform of the oil companies' liability arrangements.

In addition to the measures proposed in this communication, the Commission considers that the proliferation of operational pollution by all types of ships and the risk of particularly serious pollution by bunker oil in the event of accidents are also cause for concern. It therefore plans to examine preventive Community initiatives that could be taken in this respect.

Entry into force of the "Erika I" legislation

The Erika I legislative package entered into force on 22 July 2003. These maritime safety regulations, proposed in the wake of the shipping disaster and adopted on 19 December 2001, have been in force since 22 January 2002.

Member States had until 22 July 2003 to apply them by adopting the requisite laws, regulations and administrative provisions, and are required to notify the Commission of the transposition of these acts into national law as soon as they enter into force. Only Denmark, France, Germany, Spain and the United Kingdom have complied with this.

In addition, the Commission, pursuant to the Directive on port State control, has published a list of ships which are to be denied access to EU ports if they are detained again after 22 July 2003. This list includes ships whose flag State is described as very high risk or high risk in the blacklist published in the Paris Memorandum of Understanding annual report.

RELATED ACTS

Regulation (EC) No 417/2002 of the European Parliament and of the Council of 18 February 2002 on the accelerated phasing-in of double hull or equivalent design requirements for single hull oil tankers and repealing Council Regulation (EC) No 2978/94 [Official Journal L 64 of 07.03.2002].

Regulation (EC) No 2099/2002 of the European Parliament and of the Council of 5 November 2002 establishing a Committee on Safe Seas and the Prevention of Pollution from Ships (COSS) and amending the Regulations on maritime safety and the prevention of pollution from ships [Official Journal L 324 of 29.11.2002].

Communication of 6 December 2000 from the Commission to the European Parliament and the Council on a second set of Community measures on maritime safety following the sinking of the oil tanker Erika [COM(2000) 802 final - Not published in the Official Journal].

Directive 2002/59/EC of the European Parliament and of the Council of 27 June 2002 establishing a Community vessel traffic monitoring and information system and repealing Council Directive 93/75/EEC [Official Journal L 208 of 05.08.2002].

Proposal for a Regulation of the European Parliament and of the Council on the establishment of a fund for the compensation of oil pollution damage in European waters and related measures [COM(2000) 802 final - Not published in the Official Journal].

Regulation (EC) No 1406/2002 of the European Parliament and of the Council of 27 June 2002 establishing a European Maritime Safety Agency [Official Journal L 208 of 05.08.2002].

Proposal for a Directive of the European Parliament and of the Council on ship-source pollution and on the introduction of sanctions, including criminal sanctions, for pollution offences [COM(2003) 92 final - Not published in the Official Journal].